In an official announcement, eBay has revealed that it has signed a long-term deal with Adyen, an Amsterdam-based payments processing company, as it plans to stop working with PayPal as its primary back-end payments service in 2020, ReCode is reporting. eBay says this will allow it to manage the payments flow, simplifying the end-to-end experience for buyers and sellers.
Adyen, which was founded back in 2006, has already counted global companies like Uber, Netflix and Spotify among its customer base. The company’s business is solely focused on providing back-end payments services like credit card processing to businesses, which means unlike PayPal, users won’t see any Adyen payment buttons pop up on eBay.
Although PayPal will continue to remain a payment option for shoppers on eBay after its existing agreement ends in 2020, it will not be prominently featured ahead of debit and credit card options. Also, PayPal will cease to process card payments for eBay after 2020.
At eBay, the move is being billed as a way to take more control over the critical checkout experience as other giant online shopping destinations like Amazon and Alibaba have, while giving more payment options to eBay shoppers. Adyen supports more than 200 payment methods across the world, eBay said in a blog post announcing the news.
The move is also expected to eventually add $2 billion of revenue to the eBay business, because the company will start to charge eBay sellers for the payments service; today, PayPal does.
PayPal’s stock dropped as much as 12 percent on the news in after-market trading.